Business | Aviation

American Airlines pilots plan strike

Union and management to hold talks

AP

Published: 18:08 August 23, 2012

Dallas (AP) Leaders of the pilots’ union at American Airlines raised the threat of a strike and also met on Wednesday with the CEO of US Airways, which is pursuing a labour-backed merger with American.

The Allied Pilots Association said that it would hold a strike-authorization vote as soon as American tries to use the bankruptcy process to throw out its contract with pilots and impose new pay and work rules.

The airline said that a strike would be illegal.

A hearing on American’s request to cancel the pilots’ contract is scheduled for September 4 before a federal bankruptcy judge in New York.

Federal law makes it difficult for airline unions to legally strike. In 2007, a federal appeals court blocked a planned strike by flight attendants at Northwest Airlines after the airline threw out the union’s contract as part of its bankruptcy case.

Union spokesman Gregg Overman said pilots would strike only if they had legal permission from the National Mediation Board, but Wednesday’s declaration showed labour’s resolve.

“Our pilots are looking to us for leadership to resist any move by management to reject our contract,” Overman said. He said the union still wants to negotiate with the company.

The company warned against a strike.

“Any form of job action by pilots would be unlawful, either before or after a decision by the court on the company’s motion” to throw out their contract, said Bruce Hicks, a spokesman for American parent AMR Corp, which is based in Fort Worth.

The standoff between the union and AMR comes as US Airways, based in Tempe, Arizona, continued to press for a merger that would put US Airways executives in charge of a bigger, combined airline.

Chairman and CEO Doug Parker and two other top US Airways Group Inc executives flew to Dallas-Fort Worth on Wednesday to meet the new acting president of the pilots’ union, Keith Wilson. Overman, the union spokesman, said they had a wide-ranging discussion “about the potential for further industry consolidation.”

AMR CEO Thomas Horton was dismissive of US Airways’ overtures for several months, preferring that AMR emerge from bankruptcy protection on its own. Under pressure from creditors, however, AMR has started exploring merger options, including with US Airways, that creditors could compare to an independent AMR.

American is trying to slash annual labour costs by about $1 billion and return AMR to profitability after it lost more than $10 billion since 2001. American won concessions in new contracts covering about 40,000 ground workers and flight attendants.

But American’s 8,000 active pilots risked even deeper cost-cutting measures by rejecting a company offer this month. American’s first attempt to nullify the pilots’ contract was denied by the judge on two narrow issues. The company changed those items and has again asked the judge for permission to throw out the pilots’ contract.

Bankruptcy law lets companies escape union contracts if they convince a judge that it’s necessary for their success. That’s what Northwest did with flight attendants, who responded by threatening to strike. A federal appeals court in New York ruled that the flight attendants were “intransigent” despite Northwest’s need to cut costs and that the airline had a right under bankruptcy law to throw out the contract.

American’s pilots last went on strike in 1997. President Bill Clinton ordered them back to work within minutes and appointed a special board to study the dispute.